The first three months of 2018 brought merger and acquisition activity to a level not seen since 2001 in healthcare — $890.7 billion in deals, to be precise. M&A in this space is showing no signs of slowing.
As hospitals explore mergers, acquisitions or new partnerships to improve their finances and enhance quality of care, IT is one of the top drivers supporting success. When considering a merger, hospital leaders in charge of IT should be at involved in the strategic planning process from the get-go, according to Andy Nieto, health solution manager at Lenovo Health.
Mr. Nieto said technology, like Lenovo's, offers innovative ways to cut costs and drive efficiencies to keep up with the new M&A reality and ensure the delivery of optimum patient care. Throughout the process of a merger or acquisition, hospitals must have strong post-merger IT strategies that support value delivery on all levels, he added.
Mr. Nieto caught up with Becker's Hospital Review to share his thoughts on hospital IT considerations as organizations face new partners or newly expanded competitors.
Editor's note: Responses have been lightly edited for clarity and brevity.
Question: How are mergers, acquisitions and partnerships affecting hospital IT departments?
Andy Nieto: Data integrity and data access control are areas of concern when the M&A activities cross technology platforms. For example, a hospital on Cerner merges with a hospital on Epic. You have a complete mismatch of the data elements and are forced to leverage budget money to ensure the systems are interoperable. You also have operational behaviors in the IT departments that are driven around workflows that are not always consistent from facility to facility. Thus, there can be a lot of re-learning and a lot of misalignment of resources. It takes a really well-guided CIO to say, 'This is how we will level the playing field.'
There are two approaches that we are seeing in the industry. The first approach is to maintain disparate systems and merge where possible. I equate that to peeling the Band-Aid as slowly as possible until you finally achieve the desired merging of systems. This approach tends to be very ineffective. A more effective approach is to adopt a line of thinking such as: 'We have selected 'System A' as the go-forward platform. Here is the migration plan and we are going to move forward by replacing 'System B'.
Q: What should CIOs consider when their hospital forges a new partnership or is acquired by another organization?
AN: CIOs need to begin with understanding the workflows that are most common in their hospitals, the data elements necessary to support those workflows, as well as end-user satisfaction throughout the process of adopting new technologies. Moving to an EHR for cost reasons without evaluating the long term impact on staff retention, clinician satisfaction and patient satisfaction can be a recipe for disaster. An example might be a hospital that determines, during a merger, they are going to go with the cheapest IT system. Down the road, they find out that not only do their physicians hate it, but they have to hire twice as many nurses because it is taking longer on the floor to perform certain tasks. Or, the EHR they selected doesn't interoperate with the population health solution that the hospital uses. As you can see, it’s important for CIOs to understand the data, the users and the workflows.
Q: How do you recommend newly merged organizations address their EHR strategy?
AN: Following a merger or acquisition, the ability for clinicians to access patient data is 'Job One.' CIOs and the IT teams need to devise and lead a strategic EHR integration plan that considers how clinicians or others can access the data to deliver optimum and efficient care that improves patient outcomes. And, as care moves beyond the traditional walls of the hospital to areas such as telehealth or home care, it’s critical that clinicians have the optimum IT devices to access patient data anywhere care is delivered.
Q: What should CIOs look for in a strategic partner?
AN: In my opinion, good strategic partnerships start with a shared vision for improving care delivery. IT vendors can bring tremendous innovation to the table and often position themselves to hospitals such as: 'We are a good strategic partner for your healthcare organization because we'll have the IT tools you need to treat patients both effectively and efficiently.' When exploring a merger or partnership, hospitals like to say: 'We are a good strategic partner because our goal is to deliver the best care to our community, region or population.' The best approach for health organizations considering a partnership is for all parties to sit down and ask, 'What are our respective long-term initiatives, and how can we best support these shared long-term initiatives?' It isn't about either organization being better, it’s an approach built on the strategy that the new organization will deliver extended value to those patients it serves.
Q: How can IT leaders go about gaining physician buy-in for new initiatives?
AN: When we look at how we can support healthcare from a technology perspective, we have to start with technologies that either have multiple uses or can be used in multiple environments. As hospitals consider new IT initiatives, they need to include clinicians as well as other hospital professionals in the decision making process. This is a significant driver of success. Hospitals and clinicians should also be open to working closely with the IT innovators developing new solutions. They can support the R&D process by sharing insight in areas such as workflows or what the clinical and operational needs of the healthcare organization are so technologists can build and enhance IT solutions that deliver the expected outcomes.
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